FlourMills restructures operations against uncertainties
Specifically, the Group Managing Director of the company, Paul Gbadebo noted that the group despite the devaluation of the Naira and unrest in the North East in the financial year, was able to record a profit that is 71.4 per cent higher than N8.4 billion recorded in 2015.
According to him, the firm’s management is determined to further restructure its operations, streamline its business operations to focus on core businesses and constantly monitor and manage its costs optimally to hedge against further economic challenges that might evolve.
He added that the management is resolute in ensuring that sustainable returns and dividends from the group’s agro allied investments are properly harnessed by maximising local content in the group’s products, bye-products and processes.
Gbadebo explained that the group had an inspiring year wherein group revenue grew by 11 per cent from its 2015 figures of N308 billion to reach N342billion while its profit before tax increased by 49 per cent from N7.7billion to N11.5 billion.
Furthermore, the Company, Flour Mills of Nigeria Plc, posted a revenue of N248 billion, a growth of eight per cent over the N230 billion of last year. Similarly, the company’s profit before tax grew by 589 per cent to N6.2 billion from the N0.9billion posted last year, while profit after tax grew by 334 per cent to N10.4 billion from N2.4billion.
On the operating environment, he said: “Cost of sales was impacted by higher cost of foreign currency due to foreign market deregulation resulting in closing blended exchange rate of N295 to $1 as against CBN rate of N197.50.
“The company was able to offset the impact of the foregoing on its bottom-line only by gradual increases in selling prices of its products.“The strong improvement in revenue and profitability was primarily driven by volume growth and efficiency gains, while benefits arising from the sale of investment in our associate company – UNICEM helped to improve the bottom line”.
Based on the financial performance, he said the declaration of a total of N2.62 billion representing dividend payment of N1 per ordinary share of 50 kobo each. Is being proposed by the board to the shareholders.
“During the year FMN increased its already substantial investment in its agro allied businesses where it now grows and processes maize, soy beans, sorghum, sugar cane, palm oil, rice, cassava and poultry and our dominant supply of fertiliser and agri sacks to the Nigerian market.
“FMN continues to be one of the major promoters of the Agricultural Transformation Agenda of the Federal Government with its on-going agro-allied investments aimed at creating jobs and stimulating economic activities in urban and rural areas.
“We shall continue to leverage on the unassailable quality of our flagship product, Golden Penny Flour; the growing popularity and market acceptability of our sugar brand; our continuous investment in new milling technology; our major investments in Agro Allied businesses; development and introduction of new products in response to evolving consumer expectations; and, our strengthened Pan Nigerian products distribution network to generate improved earnings and deliver superior shareholder value”, he added.
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